ÿþ12:34 28Oct05 Employment cost index release Wednesday, December 14, 2005 10:00:12 PM (GMT-06:00) Provided by: Reuters News 12:34 28Oct05 Employment cost index release This report is WebGrabbed from the US Government WEB site Technical Contact: USDL: 05-2086 (202) 691-6199 ocltinfo@bls.gov Media Contact: TRANSMISSION OF MATERIAL (202) 691-5902 IN THIS RELEASE IS EMBARGOED Internet address: UNTIL 8:30 A.M. (EDT), http://www.bls.gov/ncs/ect/home.htm FRIDAY, OCTOBER 28, 2005 EMPLOYMENT COST INDEX-SEPTEMBER 2005 Total compensation costs for civilian workers increased 0.8 percent from June to September 2005, seasonally adjusted, virtually unchanged from the 0.7 percent gain from March to June, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Benefit costs between June and September rose 1.3 percent and continued to outpace the gain in wages and salaries for civilian workers, 0.6 percent. The Employment Cost Index (ECI), a component of the National Compensation Survey, measures quarterly changes in compensation costs, which include wages, salaries, and employer costs for employee benefits for civilian workers (nonfarm private and State and local government). Increases in benefit costs accounted for over 40 percent of the rise in compensation costs for civilian workers from June to September 2005. Among private industry workers, benefit costs contributed one-third of the compensation gains during the quarter. Among State and local government workers, benefit costs comprised over one-half of compensation cost gains during the June to September period. Health insurance costs and defined benefit contributions each represented approximately one-fifth of the gain in compensation costs for State and local government workers from June to September 2005. Hurricanes Katrina and Rita struck the Gulf Coast during the reference period for the ECI, affecting the lives of millions of Americans and resulting in significant disruptions in business both inside and outside of the impacted areas. Survey response rates in the affected areas were lower than usual, but the data from nonresponding establishments account for less than 1 percent of the overall sample. There does not appear to have been any tangible effects on the estimates. Quarterly changes, seasonally adjusted Compensation costs for the private sector rose 0.8 percent from June to September 2005, compared with a gain of 0.6 percent in the prior quarter. For State and local government workers, compensation costs rose 1.1 percent in September, greater than the gain of 0.7 percent for the quarter ended in June. (See tables A and 1.) Benefit costs rose 1.3 percent for both civilian and private industry workers in the September 2005 quarter, following more modest gains of 0.8 percent for both sectors in the June quarter. Benefit costs for State and local government workers increased 1.7 percent in the September quarter, compared with a 1.2 percent gain in the prior quarter. Wages and salaries for both civilian and private industry workers increased 0.6 percent during the September 2005 quarter, the same increases as in the previous two quarters. Wages and salaries in State and local government advanced 0.7 percent during the June to September 2005 period, following an increase of 0.5 percent in the prior quarter. Table A. 3-month percent changes in Employment Cost Index, seasonally adjusted Dec. Mar. June Sep. Dec. Mar. June Sep. Compensation Component 2003 2004 2004 2004 2004 2005 2005 2005 Civilian workers Compensation costs 0.8 1.1 0.9 0.9 0.8 0.7 0.7 0.8 Wages and salaries 0.5 0.6 0.6 0.7 0.5 0.6 0.6 0.6 Benefit costs 1.5 2.2 1.6 1.4 1.6 1.2 0.8 1.3 Private industry Compensation costs 0.8 1.1 0.9 1.0 0.8 0.6 0.6 0.8 Wages and salaries 0.6 0.6 0.6 0.7 0.4 0.6 0.6 0.6 Benefit costs 1.5 2.2 1.7 1.3 1.6 1.1 0.8 1.3 State and local government Compensation costs 0.7 0.9 0.9 0.8 0.9 1.0 0.7 1.1 Wages and salaries 0.5 0.6 0.5 0.4 0.6 0.8 0.5 0.7 Benefit costs 1.3 1.6 1.8 1.6 1.5 1.5 1.2 1.7 Over-the-year changes, not seasonally adjusted Annual compensation cost increases moderated for civilian and private industry workers for the year ended September 2005 compared with over-the-year increases for September 2004. Compensation costs for civilian workers increased 3.1 percent for the year ended September 2005, lower than the 3.8 percent over-the-year increase for September 2004. Compensation costs in private industry rose 3.0 percent in the year ended September 2005, slowing from a 3.7 percent increase in September 2004. Compensation costs increased 3.7 percent for State and local governments for the year ended September 2005, compared with an over-the-year gain of 3.4 percent in September 2004. (See tables B, 2, and 3.) Table B. 12-month percent changes in Employment Cost Index, not seasonally adjusted Sep. Sep. Sep. Sep. Sep. Sep. Compensation Component 2000 2001 2002 2003 2004 2005 Civilian workers Compensation costs 4.3 4.1 3.7 3.9 3.8 3.1 Wages and salaries 4.0 3.6 3.2 2.9 2.4 2.3 Benefit costs 5.3 5.1 4.9 6.5 6.8 5.1 Private industry Compensation costs 4.6 4.0 3.7 4.0 3.7 3.0 Wages and salaries 4.1 3.6 3.2 3.0 2.6 2.2 Benefit costs 6.0 4.9 4.8 6.5 6.8 4.8 State and local government Compensation costs 3.3 4.4 3.8 3.6 3.4 3.7 Wages and salaries 3.5 3.9 3.1 2.3 2.0 2.7 Benefit costs 2.8 5.6 5.4 6.7 6.4 6.1 The components of compensation showed differences in the rate of change. While increases in wages and salaries continued at a moderate pace, the sharp increases in benefit costs over the past several years continued to moderate. For civilian workers, wages and salaries rose 2.3 percent in the year ended September 2005, nearly identical with a gain of 2.4 percent in September 2004. Benefit costs gained 5.1 percent for civilian workers for the period ended September 2005, slowing sharply from an increase of 6.8 percent for the year ended September 2004. (See tables B, 5, 6, and 8.) Nonfarm private industry For the year ended September 2005, compensation costs in private industry increased 3.7 percent for goods-producing industries, compared with an increase of 4.6 percent for the year ended September 2004. The rise in compensation costs for manufacturing moderated for the year ending September 2005, advancing 3.3 percent compared with the 5.0 percent gain in September 2004. Compensation costs for construction rose 3.5 percent in September 2005, compared with a 2.9 percent rise in September 2004. (See table 3.) The over-the-year increase in compensation for service-producing industries was 2.6 percent, declining from the 3.5 percent gain for the year ended September 2004. Among service-producing industries, compensation gains in transportation and public utilities moderated for the year ending September 2005, rising 2.1 percent compared with an increase of 4.3 percent in September 2004. (See table 3.) Over-the-year compensation cost increases were 3.2 percent for white-collar occupations, 2.7 percent for blue-collar occupations, and 2.4 percent for service occupations for the year ended September 2005. Among white-collar occupational groups, compensation cost changes ranged from 2.3 percent for sales workers to 3.5 percent for professional specialty and technical employees. Among blue-collar occupational groups, compensation cost increases ranged from 1.6 percent for machine operators, assemblers, and inspectors to 3.2 percent for precision production, craft, and repair occupations and transportation and material moving occupations. (See table 3.) Compensation costs for union workers advanced 2.9 percent over the year ended September 2005, falling sharply from the 5.8 percent gain for the year ended September 2004. For nonunion workers, compensation costs rose 3.0 percent for the year ended September 2005, compared with a gain of 3.4 percent for September 2004. Benefit costs for union workers rose 4.1 percent for the year ended September 2005, decelerating sharply compared with the gain of 10.6 percent in September 2004. Benefit costs for nonunion workers advanced 5.0 percent over the year ended September 2005, compared with an increase of 5.9 percent in September 2004. Wages and salaries for union workers rose 2.1 percent for the 12 months ended in September 2005, nearly identical to the over-the-year increase of 2.2 percent for nonunion workers. (See tables C, 4, 7, and 8.) Among blue-collar workers, compensation costs advanced 3.0 percent for union workers, compared with the gain of 2.6 percent for nonunion workers for the 12 months ended in September 2005. In manufacturing industries, compensation cost gains for union workers decelerated sharply, rising 2.4 percent for the year ended September 2005, significantly less than the 8.1 percent increase for the year-ended September 2004. For nonunion workers in manufacturing, compensation costs rose 3.6 percent for the year ended September 2005, compared with an over-the year gain of 4.1 percent in September 2004. (See table 4.) Table C. 12-month percent changes in Employment Cost Index, private industry workers, not seasonally adjusted Sep. Sep. Sep. Sep. Sep. Sep. Compensation Component 2000 2001 2002 2003 2004 2005 Union workers Compensation costs 4.2 3.4 4.7 4.8 5.8 2.9 Wages and salaries 3.2 3.6 4.3 2.6 3.0 2.1 Benefit costs 6.1 2.9 5.5 8.5 10.6 4.1 Nonunion workers Compensation costs 4.7 4.1 3.5 3.8 3.4 3.0 Wages and salaries 4.3 3.6 3.1 3.1 2.5 2.2 Benefit costs 5.9 5.4 4.6 5.9 5.9 5.0 Among the four geographic regions, increases in compensation costs ranged from 2.7 percent in the South to 3.3 percent in the West for the year ended September 2005. Compensation costs rose 3.0 percent in the Northeast and Midwest. In the West, gains in wages and salaries slowed to 1.8 percent for the year ended September 2005, compared with the 2.7 percent gain for the year ended September 2004. Among the remaining regions, wages and salaries rose 2.1 percent in the South, 2.2 percent in the Northeast, and 2.6 percent in the Midwest for the year ended September 2005. (See tables 4 and 7.) State and local government Wages and salaries for State and local government workers rose 2.7 percent Private industry Compensation costs 1.1 1.3 2.1 1.7 1.2 -1.6 Wages and salaries 0.6 0.9 1.7 0.7 0.1 -2.4 Benefit costs 2.5 2.2 3.2 4.1 4.2 0.1 State and local government Compensation costs -0.2 1.7 2.2 1.3 0.8 -0.9 Wages and salaries 0.1 1.3 1.5 0.0 -0.5 -1.9 Benefit costs -0.7 2.8 3.8 4.3 3.8 1.4 ________________________________________________________________________________________ NOTE: The ECI for December 2005 is scheduled to be released Tuesday, January 31, 2006, at 8:30 a.m. (EST). Beginning with the release of the March 2006 estimates, the ECI will publish industry (C) Reuters 2005. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. 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